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2323 E.

Franklin Ave Minneapolis, MN 55406

May 15, 2012

Attorney General Lori Swanson Minnesota Attorney General’s Office 1400 Bremer Tower 445 Minnesota Street St. Paul, MN 55101 Dear Attorney General Swanson, Common Cause Minnesota is filing a complaint against the American Legislative Exchange Council (ALEC) in Minnesota for engaging in false and deceptive practices by misrepresenting their purpose in Minnesota. Founded in 1973, ALEC is an organization of nearly 2,000 state legislators, including a number of members of the Minnesota legislature, and more than 140 corporations, ALEC is registered in Minnesota as a charitable organization and at the federal level enjoys tax-exempt status under section 501 (c)(3) of the Internal Revenue Code. Common Cause has discovered compelling evidence that ALEC is a corporate lobby masquerading as a charity. ALEC’s compliance with state tax, gift, and solicitation should be reviewed by your office. Specifically, ALEC has violated Minn. Stat. §§ 309.55 subdivision 5 “to otherwise present purposes and uses of the funds which are not as provided within the purposes and uses filed upon registration of said organization under this chapter.” ALEC’s primary purpose appears to be providing a vehicle for its corporate members to lobby state legislators and to deduct the cost of that activity as charitable contributions. Each year, about 1,000 pieces of ALEC-backed legislation are introduced in statehouses across America. ALEC regularly communicates with legislators through emails [Attachment A], “issue alerts,” press releases, “talking points” and other materials to express its views and help ALEC-member legislators argue on behalf of ALEC’s legislation and/or in opposition to bills outside ALEC’s portfolio. ALEC’s by-laws declare that its mission is to "formulate legislative action programs" and to "disseminate model legislation and promote the introduction of companion bills in Congress and state legislatures." ALEC also carefully tracks the progress of its legislation in statehouses across America, producing scorecards to measure its effectiveness in getting its bills enacted. While these activities meet any reasonable definition of lobbying, ALEC insists that it does not lobby. In fact, in their registration with the state Attorney General’s Office, ALEC describes their purpose to “Provide workshops on current issues with leading experts, public figures, and elected officials.” In a complaint1 submitted April 21 to the Internal Revenue Service’s Tax Whistleblower Office, Common Cause seeks an investigation of ALEC’s lobbying activity, the collection of unpaid taxes and the assessment of appropriate penalties. In support of our submission, Common Cause has provided the IRS with more than 4,000 pages of ALEC materials documenting the organization’s lobbying.
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As attorney general, you’re charged with responsibility for ensuring that Minnesota laws are properly applied and enforced. In view of the overwhelming evidence that ALEC is engaged in lobbying, I urge you to review its compliance with all applicable state laws or to refer this matter to the appropriate state regulatory authorities for their action. Thank you for your attention to this matter.